January 12, 2015  Trade Alert -  BABA Black Sheep  Portfolio

As we discussed in the Saturday Report, we will roll down our long calls to a lower strike so that we see short-term calls at lower strikes and pick up more premium decay:

 

BTO 2 BABA Jul-15 100 calls (BABA150717C100)

STC 2 BABA Jul-15 110 calls (BABA150717C110) for a debit of $4.35  (buying a vertical)

BTC 1 BABA Jan-15 110 call (BABA150117C110)

STO 1 BABA JAN5 15 103 call (BABA150130C103) for a credit of $2.10  (selling a diagonal)

 BTC 1 BABA Jan-15 106 call (BABA150117C106)

STO 1 BABA Jan4-15 102 call (BABA150123C102) for a credit of $1.68  (selling a diagonal)

Be prepared to change these price limits by $.05 or more in order to get an execution.  

 
Happy trading.

 

Terry